The University of Southampton
Courses

MANG6071 Insurance

Module Overview

The module gives a general introduction to the theory and practice of insurance, reinsurance and captive operations. It seeks to meet the industry’s requirement for graduates with a strong insight into what makes the industry unique in terms of its handling of risk and uncertainty.

Aims and Objectives

Module Aims

This module introduces you to insurance as an approach to dealing with a subset of risks facing organisations. This module aims to provide you with an understanding of: • the role and purpose of insurance • the concepts underlying insurance as a cost-effective approach to risk management • basic principles guiding insurance practice

Learning Outcomes

Knowledge and Understanding

Having successfully completed this module, you will be able to demonstrate knowledge and understanding of:

  • the basic considerations that drive the operation of insurance;
  • the problems that need to managed in operating insurance;
  • the various forms of insurance that can arise in practice.
Transferable and Generic Skills

Having successfully completed this module you will be able to:

  • critical thinking, reflection and verbal communication during the module, and subsequently through preparation for the examination, key skills in information handling, critical analysis and written communication.
Subject Specific Intellectual and Research Skills

Having successfully completed this module you will be able to:

  • explain the rationale for different forms of insurance.

Syllabus

• Context: areas of risk in business, pure and speculative risks, origins of insurance, range of strategies for responding to risks • Elements of an insurance transaction: pooling of resources, insurance services and their function, main classes of commercial insurance, problems for insurers • The nature of insurable risks: fundamental and particular risks; criteria for insurability; insurable interest, rationale and applications • The insurance proposal: the problem of adverse selection, information asymmetry, information disclosure and contracts uberimmae fidei • Pricing insurance: principal rating procedures, underwriting for non-standard risks, physical and moral hazard, the dynamics of the insurance cycle, • Claims procedures: proximate cause and proof of loss, claims settlement, role of loss adjustors, indemnity and measurement of loss, subrogation, and contribution • Reinsurance: rationale for reinsurance, types of reinsurance • Risk financing: role of risk financing in risk management, rationale for purchase of corporate insurance, retention versus transfer, captives, finite risk programmes, insurance securitisation

Learning and Teaching

Teaching and learning methods

The module will be taught through a mixture of methods ranging from guided background reading, lectures, and group discussion of concepts and examples. Where appropriate the lecturer will draw on the experiences of students and through class discussion, encourage reflection on concepts and processes. Acquisition of knowledge is an important objective of this introductory module. To facilitate learning, the teaching approach emphasises the basic rationale for insurance and the problems that require treatment in operationalising effective insurance

TypeHours
Independent Study63
Teaching12
Total study time75

Resources & Reading list

S.R.Diacon & R.L.Carter (1992). Success in insurance. 

R. Thoyts (2010). Insurance Theory and Practice. 

D. Atkins & I. Bates (2008). Insurance. 

Assessment

Formative

Class discussions

Summative

MethodPercentage contribution
Examination  (2 hours) 100%

Repeat

MethodPercentage contribution
Examination  (2 hours) 100%

Referral

MethodPercentage contribution
Examination  (2 hours) 100%
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